So, The Wall Street Journal is reporting that Microsoft was very close to take over Nokia, but that the talks eventually broke down, probably beyond repair - at least for now. The reasons the talks broke down illustrate something that I have repeatedly tried to make clear for a long time now: Nokia isn't doing well.

Whenever this topic of Android comes up people keep forgetting that for the last year or so Nokia has been supply constrained not demand constrained. They are selling every phone they can make. They don't care what the aggregate numbers for Windows are, they care that the demand for Windows is sufficient to allow them to sell their manufacturing capacity at a high margin.

People forget that Q4 and well into Q1 Nokia was severely supply constrained. It may have to do with overwhelming demand, but it also may have to do with the way they manage supply and with component shortages.

It is a fact though that Nokia would've sold more Lumias in Q4 had they not been constrained, they've said this much. I just don't know if it would've been a dramatic increase, but it could explain Q1 sales beating out seasonality.